Gold futures fell to a two-week low on Monday after the dollar rose against the Euro causing the precious metal to lose appeal for investors.

Gold futures for February delivery fell $1.30, to $799.3 an ounce at 3:38 p.m. on the Comex division of the New York Mercantile Exchange, after reaching $789.60 earlier, the lowest since December 3.

The dollar climbed against the euro, reaching a seven-week high on reduced expectations of another interest rate cut by the Federal Reserve.

Interest rate differentials and the dollar's movements are again likely to be key to gold's price direction in the week ahead, and in addition liquidity may start to become an issue as people break early for Christmas celebrations, said James Moore, an analyst at, in a research note.

Moore expects dips to be viewed as buying opportunities as gold generally moves in the opposite direction of the U.S. currency. Prior to today, gold gained 25 percent this year as the dollar dropped percent 8.5 against the Euro.

The dollar index, which tracks the performance of the greenback against a basket of other major currencies, edged up 0.1 percent at 77.520.

Silver futures for March delivery were virtually flat, dropping $0.003 cents to $13.980 an ounce.